The Commission announced a settlement today in a case involving fraud charges against Larry W. Tyler. The Commission had charged the defendant with securities fraud in connection with fraudulently marketed viatical interests. Tyler was indicted in July 2004 by a federal grand jury on securities fraud and wire fraud charges for the same conduct. On May 19, 2005, after pleading guilty to the charges in the indictment, Tyler was sentenced to a term of eight years in federal prison, plus three years supervised release, and was ordered to make restitution in the amount of $23,571,847.

Previously, the Commission filed a civil suit against Tyler on February 11, 2002. In its complaint, the Commission alleged that Tyler raised at least $30 million from investors, and personally realized over $5.2 million in undisclosed commissions, by fraudulently enticing more than 480 mostly elderly investors into purchasing investments issued by his company, Advanced Financial Services, Inc. According to the complaint, Tyler deceived the elderly investors with false guarantees about the investment's liquidity, above-market interest rates and "fixed" maturity dates. Tyler used investors' funds to buy viaticals, which rendered the guarantees false because viaticals are illiquid investments with no fixed maturity dates and uncertain rates of return. Tyler hid the fact that the underlying viaticals could not fulfill the promises that he had made to investors and that the investors had to rely on him and his company to carry through on the promises of guaranteed returns, fixed maturities and liquidity. Two weeks before the Commission filed its suit, Tyler and his company both filed for bankruptcy.

Tyler consented to the entry of a final judgment enjoining him from future violations of Sections 5(a), 5(c) and 17(a) of the Securities Act of 1933 and Section 10(b) and Rule 10b-5 thereunder of the Securities Exchange Act of 1934 ("Exchange Act") and also directing him to comply with a cease-and-desist order that the Commission previously issued against him in May 2001. Further, Tyler agreed to an order finding him liable for disgorgement in the amount of $5,232,099 plus pre-judgment interest in the amount of $750,672. Tyler was ordered to pay only $1,796,000 of this amount, representing the value of the assets recovered by the receiver appointed in the case, in light of his criminal sentence and order of restitution. The Commission withdrew its request for civil penalties. The trial court entered the final judgment on September 22, 2005.